8 the economics of tourism

8/16/2019 8 the Economics of Tourism

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THE ECONOMICS OF TOURISM

TOPIC 8


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• Identify the economic benets for anation, both nationally andinternationally

• Be aware of the negative economiceects of tourism for destinations

• Understand how tourism is measuredstatistically

• Recognize the limitations of statisticalmeasurement

Outcomes


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• Tourism is a human activity whicharises in part from economiccircumstances of the consumer

• Tourism has an economic impactupon nations and regions

Introduction


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• !conomics analyses theways in whichindividuals, groups andorganizations useresources to improvetheir well"beings

• #carcity, choice andopportunity cost, etc

Economics


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The International Tourist Market

• Travel and tourism is probably the singlemost important industry in the world

• Tourism accounts for at least $ percent of

the world%s gross domestic product &'()*• Tourism sectors employs over +- million

people

•

In .+., there were over /0. millioninternational tourist arrivals

• International tourism receipts grew toU#1/+/ billion &3$/4 billion* in .+.


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The International Tourist Market

• (omestic tourism – 4+ billion domestic trips by 5mericans in

..$

– $$ million international outbound trips – India is the fastest"growing mar6et for

domestic tourism

– 7ore than + billion domestic trips in .++ 8prediction

• Trends in international travel

• Tourist destination


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Most-isited Countries


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International tourism recei!ts


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International tourisme"!enditures


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Chea!!rice

Hi#hdemand

Hi#h load$actor

%o& cost!er

tourist

The relationshi! 'et&een cost(!rice and demand


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• 'athering data on tourists is a vital tas6for the government of a country as it isvital to its own national tourist o9ce and

the providers of tourism services• Tourism organizations use such data to

forecast

•

:uture planning can be underta6en• ;an use these data in decisions regarding

the infrastructure and superstructure

The )alue o$ Economic *ata


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• Income

• !mployment

•

Balance of )ayment• Investment and (evelopment

• Balancing economic diversication

and overdependence on tourism• In


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• ta=

• #alaries

•

Interest• Rent

• prots

Income


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• 5ccording to >TT;, ?obs in tourism accountfor @0 per cent of total employment

• /$ million ?obs by .+@• #ome ?obs are seasonal or part"time, so

tourism%s contribution to full"timeemployment is considerably less than the

total employment gures may suggest

• Technology threatens labour opportunitiesin tourism

Em!lo+ment


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,alance o$ Pa+ment

• Tourism may have a ma?or in


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Inestment and*eelo!ment

• )rivate investors see tourisminvestment as high"ris6 investments

• Ban6s are reluctant to lend money

for tourism pro?ects• Investment is something of a chic6en

and egg situation 8 accelerator

conce!t• 'rowth in tourism and economic

development is uneven


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diersication andoerde!endence on

tourism• :or some countries or even regions,such as rural areas or decliningindustrial areas, tourism may oer an

opportunity to diversify the economy

• tourism may amalgamate withfarming business 8 a#ritourism

• ver reliance on tourism can bringdi9culties


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diersication andoerde!endence on

tourism


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In.ationar+ !ressure

• Tourism can push the cost of resources &land,labour* higher, creates an imbalance in terms ofsupply

• It can create in


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The o!!ortunit+ cost o$tourism

• Resources used to support tourismindustry is unavailable to otherindustries

• >hen government ta= local peoplefor tourism investment purpose


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Statistical measuremento$ tourism

• 'overnment use statistics to get to 6nowthe contribution that tourism ma6es tothe economy in terms of income,

employment, balance of payment andinvestment

• 'overnment wish to 6now the trends,with nation and across nations

• Tourist o9ce use this information toforecast, plan, promotion campaigns, etc


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Statistical measuremento$ tourism

• The information must be both Dualitativeand Duantitative, egE – Fumber of international visitors, number of

domestic tourism – Gow these are distributed over the month of

the year

– Tourist%s spending patterns

–

7ode of travel – (uration of stay

– #ociographic proles 8 personality, lifestyle, etc


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*omestic andInternational sure+s

• #tatistics of tourists belong to dierentregions

• 'lobal tourist statistics by

organisations such as !;(, UF>T,etc

• #tatistics about domestic tourism is

also vital• (one by local tourist o9ces, nation

wide tourism associations, etc

ec n /ues an !ro ems


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ec n /ues an !ro emsre#ardin# measurement

o$ tourism• (emand for Dualitative research• #ome criticisms of Duantitative

methods

• Tourism satellite accounts – UF>T introduced concept

– 5 system which include all indirect

e=penses and their resultantcontribution to '(), employment andcapital investment


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Further issues

• #ustainability

•

!ort to ma=imising multiplier eect

•

;omputerization of data

8 the economics of tourism

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